I would say Mustachians (or anyone active on any passive investing personal finance site) are better investors than most because they have read more than the average person and are more likely to not attempt to actively time the market when they don’t know what they are doing. (The ones that do know what they are doing may not fare much better either). That’s enough to be better than average because so many are scared of investing or dance in and out. There is no evidence to suggest that Mustachians are worse than average. It will be interesting how the boards change during a downturn I agree. These forums have only been open during a major bull run, although there have been some bumps along the way.
This thread is on the UK board so there is no one here 100% VTSAX. I bet there is no one here (UK) that is 100% stocks either. Most people may say they are 100% stocks but may only be referring to a particular pot. They may have a rental or a larger than normal emergency fund or a DB pension etc alongside their ‘100% stocks’ pot. It’s easy to be gung-ho with stocks when there is the security of other income streams.
The majority of the UK board are not doing what you are saying here. They are not buying with the herd and selling with the herd. Where has this opinion come from? From what I have read they are investing what they can when they have it, usually monthly in funds such as the LifeStrategy series. These invest no more than 35% or so in the US and do have exposure to emerging markets etc giving greater geographical diversification than 100% VTSAX would.
There is nothing wrong with 100% VTSAX if you live in the US and that’s the way you want to go but many US based people invest internationally too. There are loads of US members on these boards that speak of their international allocation. I don’t live there so it’s not something I even think about. I’m not going to invest 100% in the US and I’m certainly not going to invest 100% in the UK either.
I would hope during a downturn that our UK board especially, will be a very supportive and encouraging little community that helps everyone to not panic and sell, but to stick with the plan. Asset allocation and attitude to risk is of course vital but that’s what people learn here and on sites like Monevator.
The fact of the matter is that investing prowess is only really 5% of the message here. The value I have gained is in reducing my impact on the environment, simplifying my life and minimising my expenses permanently I.e. reducing future expenditure as well as current. I now have the ability to live comfortably on a minimum wage job. If a downturn hits and I lost my job, any job I am willing to do is now good enough, where before maybe I needed to score a job paying a salary in the top 20%. There’s some tough competition there. Having control of ones expenses is the crucial point. The security level here, the confidence and attitude that this brings is worth far more to me than being able to eke out an additional 1% returns through investing. Ensure tax efficiency yes, think about asset allocation, invest in low cost funds, make sure the stocks element is global, but other than that if you’ve no interest in investing don’t worry about it. Spend more time on your expenses, learning new skills and family/friends.
For the OP as others have said ISA’s, Junior ISA’s/SIPP’s are your friend. Also a useful link:
https://monevator.com/asset-allocation-construct/